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Us 17, S&p 12, U.s. 10, New York 9, Ashley 9, Boston 9, California 9, Manhattan 9, Nicole Petallides 8, Aol 8, New York City 7, China 6, Citi 6, Sandra Smith 5, Massachusetts 5, Hollywood 5, Activision 4, Fisher 4, Liz Claman 4, Josh Rosner 4,
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  FOX Business    Markets Now    News/Business.  
   Business news. New.  

    February 8, 2013
    1:00 - 3:00pm EST  

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dennis: the real estate recovery story going on all day. cheryl just recently put up her manhattan apartment for sale. cheryl: they got i found a new apartment because i was worried with the inventory level so low. you have incredibly low interest rates. dennis: how much did you have to cut your price? cheryl: i got asking him for days. when i say money is free, money is free and real estate right now.
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melissa: not that she is bragging or anything. [ laughter ] ashley: good for you. melissa: thank you. ashley: good afternoon, everybody. i am ashley webster. melissa: i am melissa francis. the housing market kicking into high gear. ashley: zillow economist weighs in on which market is best for buyers. melissa: we will ask the ceo of citi mortgage. ashley: whiteout conditions expected to last well into tomorrow. time for stocks now as we do every 15 minutes. nicole petallides is standing
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by. nicole: last friday we closed out 14,009. that is our highest close in five years. while we are not too far off from that, about 20 points, we would still have a losing week here on wall street. it certainly feels full force here. people are trying to figure out how they will get home later. the tech heavy nasdaq is the best of the bunch. as you noted, with the snow, many places closing their branches. i want to take a look at a one-year chartier on the dow jones financials.
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inventory of furniture, automotive goods, they will sell by the most we have seen in three years. back to you. melissa: thank you so much. ashley: if you have money, life is good. the luxury real estate market on both coasts is still very hot. more homes selling for $5 million or higher than ever before. new york cash-rich foreign buyers are stealing spots. we are taking a look at two of these markets. sandra smith is in new york, robert gray on the west coast. let's start with sandra. sandra: it is amazing what we are learning. we are sitting in a gorgeous $2.5 million home and we are in manhattan.
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you own the entire building. it turns out you acquired this building a long time ago. >> yes. 1984. the real estate values were down dramatically. we acquired it back in for $700,000. there were 12 floors in the building and all full floor tenants. sandra: it was a family acquisition. >> it is valued at about $60 million. sandra: that is a good return on your investment. $2.5 billion units now. a few of your floors are commercial, but mostly residential. why do you think that somebody should buy this particular unit for $2.5 million? >> what is really unique about this building is every tenet in here will have a full floor presence. they will not have neighbors.
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sandra: let's show that. this is how you get into the condo. you have your own private elevator entrance. tiny elevators. this is your own private entrance. you say that is a major plus. >> yes. they do not want to see other things from other tenants. they want to have a bit of privacy. sandra: we will have to leave it there. we are going to jump over to the west coast. the real estate market right now is -- >> booming. ashley: booming. it has been a long time we have been able to say anything like
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that for the real estate market. how about 14,000 square feet? robert gray has a look at the high end housing market in los angeles. robert: we have about 14,000 square feet. we are in the hollywood hills here. we are on nightingale. it is going for $13.7 million. the high end of market here. a lot of folks trying to sell before the capital gains taxes went up. there still is not a lot of inventory out there. that is why one of the top
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realtors in the state, if not the nation, says that he sees this trend continuing. >> the luxury and right now is great. it is at an all-time high. we see it continuing. we do not see the trend changing at all. it is just one of these things where the inventory is low and the interest rates are where they need to be. people who have been sitting on the sidelines are starting to staff took some great properties. we have a lot of international buyers, local buyers and families. it is perfect. peter: they saw a recession here and a lot of properties are going for less then maybe they thought they would have a couple of years ago. if you want to live with leonardo the caprio, come on out. ashley: looking good, robert.
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melissa: the real housewives husband. ashley: thank you so much. melissa: u.s. home values closing out. 2012 medium home values are up 5.9% year over year. dan humphries -- stan humphries expects the recovery to continue. he is here with his predictions. thank you so much for coming on the show. let's start with the worst market for 2016. i want to drill down on some of these details. the places where you do not expect to see the biggest jump over the next year. they may be good opportunities for buyers, right? >> yes.
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some of the markets that will move slowest over the next year are markets in the midwest and northeast. think cincinnati, cleveland, new york, outside the five boroughs. out in new jersey, the markets are definitely moving slower. melissa: the reason why we highlight those, we call them the worst price appreciation over the next year, but they create good opportunities. talk about some of the best price appreciation targets right now. >> the best price appreciation that we expect to see is coming in markets that were the hardest hit during the downturn. phoenix, vegas, san francisco, san jose, a lot of southern cal.
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they are now rebounding strongly. in phoenix we are seeing home prices rising 22% year over year. very hard-hit markets. we expected to be up next year. melissa: when you look at the numbers on screen, it makes me very nervous. it feels like it looks like before the bubble. it sounds a little dangerous. >> there is no dow that we are seeing almost a mini bubble again in this market. there is a lot of negative equity.
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people are under water so they cannot put their homes for sale. we see retirees and second home buyers coming back. the people who want to sell their homes cannot because they are underwater. it is not sustainable. melissa: that is a great point. what should people expect going forward? what is a reasonable price? >> housing return is about 3%. phoenix we would expect to be half next year. people should not expect, it has been a roller coaster ride for consumers. melissa: thank you so much, stan humphries. good information. >> thank you. melissa: zillow says chicago is the best market for buyers. we will ask the president of
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zillow. you do not want to miss that. ashley: the northeast bracing for a blizzard. we will have the very latest on the storm's timing and track next. melissa: new details on what caused the super bowl to go dark and who is to blame. take a look at metals here as we go to break. ♪ ♪
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and the aerospace industry in the u.s.? at t. rowe price, we understand the connections of a complex, global economy. it's just one reason over 75% of our mutual funds beat their 10-year lipper average. t. rowe price. invest with confidence. request a prospectus or summary prospectus with investment information, risks, fees and expenses to read and consider carefully before investing. melissa: as we do every 15 minutes, let's get a check on the markets. nicole petallides is watching linkedin. nicole: linkedin up almost 22% today. great move.
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obviously hitting a new all-time high since the ipo back in 2011. obviously, professional social network company. everyone seems to be very familiar with it. they have gotten more dollars from the corporate recruiters. they have expanded the membership. $151..04. let's take a look at the dow jones industrials. this could be our longest winning streak since august august 2012. the russell, they have been doing exceptionally well. back to you. melissa: thank you so much.
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ashley: no longer in the dark. entity new orleans taking the blame for sunday's 33 minute blackout during the super bowl. though cause was a faulty device that had been installed to, get this, prevent a failure of electric cables leading to the superdome. entity had previously denied everything. shares of its parent company down today. just about 2%. there you go. it was not us. melissa: i thought it was beyoncÉ's hairdryer. thank you. the u.s. postal service may be
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just got a little bit better. details on that had. ashley: it is dÉjÀ vu. dennis kneale on the increasing concerns over the last mortgage standing. we will be right back. ♪ oh this is lame, investors could lose tens of thousands of dollars on their 401(k) to hidden fees. is that what you're looking for, like a hidden fee in your giant mom bag? maybe i have them... oh that's right i don't
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>> just about 22 minutes past the hour. i have your fox news minute. the search for the cop killer is still underway. though former lapd cop is suspected in three fatal shootings, including one police officer. he vowed to kill police and their families. the secret service is investigating whether a hacker
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accessed secret e-mail accounts of the bush family. they hacked into several aol accounts and posted personal photos and e-mails. former congressman, jesse jackson junior, has signed a plea deal. he is accused of misusing campaign funds. those are your headlines. back to melissa and ashley. ashley: thank you so much. melissa: the blizzard warnings are here. 4000 flights have been canceled, including mine. amtrak has already suspended service. with the worst still to come tonight, let's head to accuweather adrian green. >> it will be pretty nasty as we
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had through tonight. we already have some very nasty conditions right now. the snow is coming down at a very hefty clip. visibility is already down to a half mile in some spots. we will continue to see the snow pick up in intensity. it looks like one-3 inches of snow per hour. i would not be surprised if we had a little bit of thunder snow. travel will certainly be shut down across the northeast. quite a bit of snow will be falling. one-to be expected. i do think there is an area that gets over 2 feet of snow. gusty wind.
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the wind will gust up to hurricane force for a time or to tonight. back over to you. melissa: thank you so much. i think. ashley, over to you. [ laughter ] ashley: 3.5% down. that is all it takes to be a homeowner. i thought the requirements were incredibly tough these days. dennis: the big question is if this housing recovery is for real, what is really fueling it? i came across some figures. a typical average home has only $7000 in savings.
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average income only $43,000 a year. where are you guys getting the money to buy the homes? the fha will only make you put 3% down. why? if you do not have 20%, should you be allowed to buy a home? a large number of experts say the poor and low income people are better off renting. they should not take on that risk. that is the part that really bothers me about this. the very same programs are coming and doing this all over again. people tell me a couple of things. your house is a place to live in. invest in housing stocks. is it too late? some say no. borrow less, not more.
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if you do not have 20% for a down payment, do not buy a house. that is what i do. i rent. it is humiliating. melissa: there are a bunch of really nice places to rent. that is where you made all of your money. dennis: i do not think we will have the kind of bubble as we did before. the government has not learned their lesson. melissa: fannie and freddie not reform. the u.s. postal service is not just losing saturday delivery, it lost $1.3 billion in its fiscal year first quarter. that was not quite as bad as the $3.3 billion for the same quarter a year earlier. the post office says, this
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quarter is a little better due to election mailings and more holiday package deliveries. the mail volume continues to the client. they lost 1.3 billion, but it was not as bad as they could have been. melissa: zillow calls it the number one market. we are headed to the windy city. ashley: why now "is the perfect storm for positives." we will be right back. ♪
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melissa: time for stocks now. as we do every 15 minutes let's head to the floor of the new york stock exchange. nicole petallides is standing by. nicole, what are you watching? >> taking a close look at aol that trades on the floor of the new york stock exchange. here it is. it is at 33.65. that is a gain a whopping gain of 7% today for aol. certainly a great quarter for them. the profit jumped 57%. they saw strong advertising revenue growth for aol. so that is good news. we're seeing this jump here today of 7%. but over the last 52 weeks it has been a stellar performer. over the last year it is up
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71%. aol shareholders are not complaining, that's for sure. liz claman will speak with tim armstrong in thetee p.m. show. that is something to watch if you're more interested to hear about aol and their future. the dow is up 42 points right now. not 14,000. back to you. melissa: nicole, thanks so much. ashley: zillow says chicago is the best market for buyers. the question is what can you get for your money if you're thinking about what may be good? jeff flock in a three-bedroom condo for sale in the windy city. jeff, how much does it cost? >> $574,000 plus parking. i'll tell you if you live in new york city, that is a hell of a bargain, right but we're in chicago? >> yes it is. new york buyers, owners who come here think this is the biggest bargain in the world living in chicago. >> take a look at it. i think the value is here for this unit. look at the beautiful marble in terms of the kitchen. high ceilings, nice finishes. this building you bought out
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of foreclosure, correct? >> we bought the building next door out of foreclosure. the land was part of the purchase. we sold out the remaining half of the building across the way so quickly that we had a pent-up demand for buyers to continue to buy these units. >> as we walk through the unit i want to put prices up in chicago and illinois. the forecast the last few months has been positive but you have to have maybe a little blip of a downturn. where do you see it right now? >> here in chicago, i'm a chicago guy and really can't speak for the rest of the marketplace, we're not hitting the bottom anymore. we're not even bouncing around. we're on the way up albeit not as quickly and as fast a pace as some other places in the country but we're on the way up pricewise and saleswise. >> before we get away, tell me why you think this real estate recovery is for real. what do you see that tells you this is for real? >> the sustained level of sales that we've seen over the last year or so and. low mortgage rates and the
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increase in sales, or rental prices in the chicago area has made it incredibly attractive for people to buy a home compared to renting. >> i was going to say, better off, buying than renting. of course you will have to move in the next year or two. that flexibility is still important to have for rental. it makes better financial sense to buy in chicago, than to rent. ashley: yeah. a bargain for a new yorker, jeff flock, thanks so much. sticking with chicago, my next guest says the chicago real estate market is better than anybody has seen. it is perhaps the a perfect storm. we have a broker. thanks so much for joining us. you say this is the best buyers market you have ever seen? >> yeah, thank you for having me, ashley. i want to, yes, i believe this is the best market that we've seen in probably four, five years. when you look, as jeff was just saying we have a perfect storm. you are able to get both
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things, one, an excellent price for the property and then two, outstanding financing rates. and, based upon what the fed is telling us, we can expect to see that for the next few years. ashley: you know we hear all the time billion a lack of inventoris. the buyers are there but there is just not enough properties. is that a problem in chicago? >> what we're seeing in chicago from a property perspective is, we were lagging behind much of the nation, about 20%. and so we have moved, we feel like we've moved through some of our, quite a bit of our distressed inventory. so now we're at a point where we have families that we can go back and talk to, my realtor, realtor friends are out here and we're able to now go back and say to families, hey, let's take another look. let's look under the hood and see what the prices will bear. ashley: that brings me to my next question, you know who is buying? we know out west in california, arizona, they're seeing a lot of cash buyers
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and cash buyers from overseas coming in and snapping up these bargains. are you seeing any of that in the chicago area? >> well, we, yes. we're seeing, that is the trend. where you have investors making a huge investment in chicago because the prices for, from that perspective, they're able to buy and then rent to quality buyers because quality renters, because those guys have no, didn't have, they didn't have the compassion or compelling arguments to stay within the markets. so now you have, now a lot of people are doing rentals. what i think you're going to see moving forward is that there are a lot of things that have changed. you've got the you know, we're starting to get sound judgment in terms of where people are. i think that people are the ifing more consumer sentiment and as people become more confident about their jobs, i think that you will see a lot of things happening within the chicago
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area over the next year. ashley: quickly, i just want to get to this question. we're running out of time but zillow also says that chicago will be one of the worst markets in the country this year because they believe the prices have yet to bottom out. so you can't have recovery until that happens. would you disagree? >> i would disagree from the perspective that prices have yet to bottom out. if you think what is happening, look at the middle d market as jeff was talking about, the condos in the $500,000 range, if you look at the product from 3 to 700,000 we're starting to thin out in terms of inventory. so we'll start to get more quality inventory. as you get and that quality meaning nondistressed you will start to have other buyers coming off the fence. so i don't believe that we're going, you know we're not going to have the gold rush days of yesterday but i believe we will have steady, steady, steady growth. ashley: excellent. the perfect storm for buyers in chicago.
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sikh morris, thanks for joining us. >> thanks for having me. melissa: store shelves empty in massachusetts as people stoke pile bracing for the blizzard. upward of three feet of snow is expectnd boston. ashley: we have a poor reporter out in that. rising mortgage rates not stopping buyers from buying. a man from citi mortgage, and what he thinks whether rates will bottom out. that is all coming up next. [ woman ] if you have the audacity to believe your financial advisor should focus on your long-term goals, not their short-term agenda. [ woman ] if you have the nerve to believe that cookie cutters should be for cookies, not your investmt strategy. if you believe in the sheer brilliance of a simple explanation.
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or irritation where applied, increased red blood cell count, headache, diarrhea, vomiting, and increase in psa. see your doctor, and for a 30-day free trial, go to axiron.com. >> i'm cheryl casone with your fox business brief. stocks are rising on the last trading day of the week as traders hear strong data reports out of china, germany and of course here in the united states. the both the s&p 500 and the nasdaq are on track for the fifth con executive weekly gains. the dow is up 44 points. the u.s. trade deficit unexpectedly narrowed in december on a drop in oil imports and higher exports. according to the commerce department the trade gap fell 21%. that is the smallest gap in almost three years. because of stronger than expected trade report goldman sachs is boosting its fourth quarter gdp forecast. goldman did leave the
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estimate unchanged saying that stronger december trade is offset by weaker than expected wholesale inventories. that's the latest from the fox business, giving you the power to prosper
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melissa: so earlier lori rothman got a chance to speak so the ceo of citi mortgage. here she is. >> 30-year mortgage rates hovering at a four-month high, around 3 1/2% but mortgage applications continue to rise. so is this a sign that rates bottomed? no one better to ask than my next guest. he is the ceo of citi mortgage. sanjay, we're so thrilled to have you back. welcome. >> thank you. >> so interest rates rising, still at historic lows you were quick to point out to me earlier but even those couple of points can translate to thousands extra dollars added to the
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purchase price of a home. what is your take in what is driving rates right now? >> there is a lot of uncertainty in u.s. treasury rates in the past couple weeks, lori, because a lot of investors switched to buying european sovereign bonds and that caused treasurys to go up a little bit and mortgage rates to go up a little bit as well. >> does this have to do with the economy looking better. the house market is one of the brighter spots in lacklous kerr u.s. economy. >> the housing in the last year has shown a lot of strength by i think the rate drive that happened last week was because of relative perceived strength in the european economy. >> okay. >> but the u.s. economy has been strong in housing. house prices went up 5 1/2% year-over-year. this is a much more widespread growth in house prices than we have seen in six months. >> 30-year fixed is at the low, 3.31%. that was last fall. will rates fall book to that level anytime soon?
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or have we seen it for good, considering the fed's accommodative policy and what not? >> that is hard to predict. as i said these things are, i'm not trying to hedge my answer but these things are a function of relative perceived strength in different economies. i would say that they're likely to be range-bound. somewhere in the order of 3.6, 3.75%, which is still a very, very low rate. if you consider those rates for 30 years. >> so we're reporting on the economic data that mortgage applications are up. you're seeing considerable demand for mortgage products in your office. what do you, what is that attributable to then? because people are rushing to lock in the rates because they fear they will rise higher?. >> there is definitely a little bit of that. in last couple weeks we saw rates go up and refinancing applications also went up. we're seeing a very strong refi demand. we've been seeing that consistently for the last three or four quarters. >> the consumer financial
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protection bureau put a list of regulations for the mortgage industry and really declaring and telling you what types of mortgages you could offer to certain types of creditors. there was fear leading up to the list. there was anticipation what it would say and who it would affect and whether or not it would curb the industry. what is your take how it is influencing business? >> my take is very good. it is very responsible to the borrower? >> really? >> it makes the industry that much more responsible for giving the right products to the right sets of consumers. >> can you give me a specific example how it is beneficial? >> so for example, it said loans interest-only will not be qualified anymore. that means that consumers will essentially be sold principle and interest mortgages. so there is no surprises at the end of might have years with your raid suddenly spiking up or your payments suddenly spiking up if you have to pay principal. so there is some very clear guidelines. and i would say by and large
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most of the responsible banks that are responsible, like us, like citi had but it is a lot of players on the fringe this really sort of draws the boundaries for. >> good information. sanji das citi mortgage. thanks for being my guest today. >> thank you, lori. melissa: that is lori rothman speaking with the ceo of citi mortgage. it is quarter to. as we do every 15 minutes let's check the markets. nicole petallides is on the new york stock exchange with activision ahead of the blizzard. >> talk about activision blizzard when you talk about the video games and the like. it is up over 12%. this is new 52-week high. they did extremely well with the holiday sales. when i say activision, people who have videos games and such should think "call of duty" it. they should think of sky landers. my kids take sky landers. this finished sky lappedders and sky landers giants.
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the ceo did not remotely anticipate the popularity of these characters for these videos games. fourth quarter profit, reported better than expected and obviously sales have been jumping. it is a great performer, up 12%. back to you. melissa: nicole, thanks so much. ashley: from one blizzard to another then the northeast is bracing for a megastorm that could drop up to three feet of snow on boston perhaps. the question will it break the city's record set back in 2003? go to molly line who true the short straw today. molly? >> thank you so much, ashley, from your nice warm studio there. here we are keeping an eye on the boston roadways the governor asking people to stay off of these roadways by executive order. he declared a state of emergency ordering everyone to get off these roads by 4:00 this afternoon. pretty serious business here. they want to insure all emergency responders, folks driving the plows will be able to get out there, do their work without worrying about pedestrians on city streets or people getting
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stuck and crashing out here on the highways. new englanders are used to big weather, big snowstorms but at the same time it is always a dangerous thing for the people here in new england to handle. a number of press conferences held throughout yesterday and into today. the mayor asking people to stay off the city streets so that the crews, the plows can do their work. take a listenen to boston mayor tom menino. >> the public works crews are out now. we have 34 thousand tons of salt, over 600 pieces equipment ready to be deployed throughout the storm. >> another point to make, the time is ticking. if you want to take a train or bus out of the city. the transit system, the mbta, the t as it is called in boston will shut down 3:30 this afternoon. they're serious about people getting off the roads and hunker down. they offered good advice to have enough water and food and essentially stay inside. tomorrow it could take
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things a while to get koreaned up. the snow is not expected to stop until tomorrow afternoon. one of the biggest hazards are things under the snow. they're asking people to stay inside and be careful. ashley: i know you can't stay inside. do your best to stay in line. molly line in boston. thank you. just how far will your dollar stretch when buying a home? that is a big question. we're checking in with our reporters scattered all over the country to find out. melissa: check out the winners and losers in the nasdaq. activision and blizzard, we were talking about that, rocketing up 12%. we'll be right back. [ indistinct shouting ] ♪ [ indistinct shouting ] [ male announcer ] time and sales data.
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ashley: location, location, location, that's what they say in real estate and we've got you covered today. fox business is all over the country. adam shapiro in far hills, new jersey. sandra smith is here in manhattan. jeff flock is in chicago and robert gray in the hollywood hills, in southern california. melissa: really great stuff from all of you today. we thought it would be fun to learn how much you can stretch your dollar in each city so how much does a square foot cost? adam, i want to start with you. >> you're looking $406 a square foot. $2.6 million you get your own workout room. lots of places have that. check out the rain laundry room. you heard sandra smith talk about the laundry room in manhattan. this one is 100 square feet. no big deal. we got you beat. the one big selling point in this house, it is downstairs. bet you nobody in chicago, nobody in new york and nobody in hollywood has
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this. frank, swing around to show you. this is the mud room. it is a dog walk. this is a dog shower for the estate's animals. >> love it. >> try to beat that, guys. melissa: can't possibly beat that. turn over it sandra. how much is a squire foot and do you have a dog wash? >> no dog wash here but i will tell you that at $1200 square feet, that is three times the price of adam's place. this is 1900 square feet. $2.4 million. it is on the market for, guys. but i'll tell you why this place even though it is much smaller than adam's is better. there is a foot of snow expected in new york tonight. i have to snow. i have no commute to go home. guess what? i have a 11 foot ceilings with large oversized windows where i can sit pretty and enjoy the view. melissa: i love it, sandra. way to brag. we don't need a dog wash.
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jeff, over to you what is the price per square feet? >> i got you all beat indeed. melissa: good luck. >> doug wash for god's sakes. this is less than00 a square feet. three bedrooms, three baths, downtown chicago, a block from harpo studios where oprah used to work. you know the value is here. look at this. fisher appliances. two-drawer dishwasher here and only save, you know, stuff. and here's a look at this. hold on, let me make it work. there it is. melissa: make it work. >> microwave here. look at that. melissa: the price is right here or something. what a bargain. melissa: finally go back to the real housewife in california. robert what is the number there. >> none of them are here but we had the husband here earlier, guys. er is rusely, five bedrooms here, 7500 square feet. a mere 1800 bucks per square foot at particular location. outside you have a pool with hot tub. your neighbors, leonardo
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dicaprio, halle berry. larry ellison owns three houses next door. master suite every day. and a few out to santa monica and pacific ocean. i'm not here to sell this house to you. it does a good job on its own. melissa: it is stunning. robert, i think you won. that is why it is the most expensive, you guys are fantastic. great job selling. coming up tonight on "money", a real estate power panel with dottie herman, president and ceo of prudential. douglas elliman. we have bruce iker in, founder and chairman of continuing company and coldwell banker and agent million dollar listing l.a. that is tonight at 5:00 p.m. eastern on fox business. we're keeping the theme going all throughout the day. ashley: a full load of folks. melissa: it is. it will be awesome. ashley: good stuff. coming up next hour one business booming thanks to housing's rebound. fortune brands ceo christopher klein tells us
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where the home products make us the biggest stretch. tracy byrnes joining me for the next hour of fox business. she is walking in. she is ready to go. don't miss it. we'll be right back. tdd#: 1-800-345-2550 when i'm trading, i'm so into it,
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we'll have the latest details ahead. it is looking pretty ahead, is it? tracy: unfortunately it is not. ashley: let's go to nicole petallides as we do every 15 minutes. stocks trying for another week of gains. >> it is so true and yet it feels pretty good as far as market brett. you do see the up volume outpacing the down volume, 170 million to 111 million. still with an up arrow on the dow, up 47 points. however, we are not at 14,000 like we were earlier today. and i should note, that unless we get to 14,009 we'll have a losing week on wall street. i know it is a few points with a very narrow trading range. this move would be we're snapping five straight weeks of gains not only for the dow jones industrials and the s&p 500. the s&p is up half of one percent. the key level to from would
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be 1513. so we're having a winning week for the s&p 500. why not take a look here, big picture at what we're seeing. the vix, the fear index is to the downside. tracy and ashley the trading feels a little like despite the fact i'm not hearing any traders they're going home early but feels a little light. back to you. ashley: nicole, thanks so much. we'll be back in 15 minutes. tracy: all day we're taking a special look at the real estate market which has been showing some strong signs of recovery. our adam shapiro is in far hills, new jersey at a 6400 square foot home. it is on the market for $2.6 million. 25% down payment on this luxury home comes to a whopping $650,000. even the buyer has a $13,000 a month mortgage. of course those pesky property taxes. $2100. adam shapiro is inside the luxury home. that must feel pretty good,
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adam? >> it is a beautiful home. it feels pretty good. 2.6 million, kind after bargain as you look at this luxury home just completed within the past few months, that the price of homes nationwide according to corelogic has gone up at least in december, 8.3%, year-over-year. and that's the largest increase since 2006. here in new jersey median sales price for houses peaked in 2007. roughly $363,000. last year it was $302,000. it is one of the reasons that real estate agents will tell you now is still the time to buy. still bargains out there. interest rates, you're doing the numbers, if you were to buy this house and finance, that was based on 4.5%. you can actually do better than that according to fannie mae and freddie mac. here's the final deal. not only is it good for sellers right now because there is so little inventory on the market, the real estate agents are saying come back in. at the price point of say a million dollars in this part
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of somerset county they're getting multiple offers. they say now is the time to come in. for buyers it clearly is a good deal. for sellers absolutely it is perhaps time to get in. expect expect prices go up slowly not near the peak of 2007 but certainly off the bottom. tracy: time to get in you have 250,000 lying around. adam shapiro, thank you very much. ashley: the strength in housing is helping companies that make products for the home. fortune brands home and security makes cabinet, fawcett and locks and it had a phenomenal year -- faucets. they have at a 52-week high. chris klein is here to talk about it. shares are up 70% over the past year. does this truly reflect the improvement that we're seeing in the housing industry? >> absolutely. we've seen real strength in new construction really build throughout 2012 and that momentum is coming into 13. about 30% of our business is
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new construction. the other 70% is the repair, remodel side of the marketplace. the repair remodel market is growing maybe three to 4%. so not as strong as call it a 20% new construction market but put them together and we were up 8% last year and we're projecting up, strong, single digits this year. so yeah, that momentum continues. ashley: that sound very encouraging. we haven't seen a strong rebound in home rebuilding which is interessing which would be a big part of your product line. why do you think that is? >> you know, the repair remodel side is more tied to the general economy and so consumer sentiment. it is access to credit. it is willingness to step up and do a big project like a total kitchen remodel. while we're seeing signs of life there, it is definitely positive, just not at the same pace as new construction. new construction right now is being driven i think by supply demand imbalance across the country. we just stopped building a lot of homes and are running out of a lot of inventory in
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markets and that is really fueling the new construction. ashley: you talked to customers and homebuilders i'm sure. what are they telling you? >> well, think builders are being somewhat cautious and building to order but frankly their order volume is pretty strong. i think they're optimistic but they're not trying to get out ahead of themselves. i think consumers are in the same boat. they're cautiously optimistic but everybody who lived through this over the past five years doesn't want to get too far ahead of themselves. ashley: when you say live through this. we always think about of course directly the homebuilders. for a company like yours how tough has it been throughout this housing downturn? >> it is pretty dramatic. back in 2006, we were a company of 28,000 employees, almost five billion in sales. we did a massive amount of restructuring. took that down to 16,000 employees. shut over 20 plants across the country. sales went down to three billion. happy to say since then we're growing steadily. with the results of last
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year, we're back up to about 3.6 billion in sales. and, really see, you know, room for growth ahead of us. ashley: you lost some 12,000 jobs. are you hopeful perhaps you can hire some of those people back? >> absolutely. you know we'll be prudent and not get ahead of ourselves and demand will come. we'll bring in second shifts. we'll start to hire back. the good news a lot of these are american jobs. much our 16,000 employees, 12,000 are in the u.s. and so, as the economy goes and grows we'll be hiring people and that is pretty exciting. those are much better days than the days we saw in 2007 and 2008. ashley: no kidding. i can tell by the smile on your face. you think this will continue through this year and beyond? do you see any headwinds out there? >> i think we see good, consistent growth in new construction. on the repair remodel side it is really tied to the broader economy. ashley: yeah. >> there are clear headwinds in the broader economy. we're optimistic that starts to improve over time.
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we do consumer research. consumers are passionate about their homes. they want to put in a new kitchen and new bathroom. they're waiting for confidence and the right time to do it. ashley: thanks so much. christopher klein with fortune brands home and security. a great story. thank you for joining us. >> thank you. ashley: very own couraging. seems a lot happier, doesn't he obviously? things are picking up. tracy: a little spring in his step there. as ashley just did we'll keep covering the housing market today, all angles. we have josh rosner. he was early predictor of the housing crash. what is his take on the housing market right now? we'll find out. ashley: it is already been called historic and hasn't got going yet. a massive snowstorm is hitting the northeast. a forecast on snow totals next. as we do every day at this time look how oil is trading. dow is up 45 points. the oil price down slightly on this friday. down to 95.70 a barrel.
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ashley: well the northeast is bracing for what is expected to be a record breaking storm that could dump feet, up to three feet maybe of snow from pennsylvania to maine, especially massachusetts. accuweather has the very latest on the storm's track and there is no way we'll miss this thing, is there, justin? >> ashley, unfortunately no. now the full fury of this storm is yet to be seen. currently two pieces of energy, our one storm system climbing up the middle of the atlantic seaboard and we have a cold pocket of air swinging through the northeast. as these combine forces later on, it will deepen very, very rapidly. we'll see tremendous amounts of snow, blinding visibilities and some very, very high wind. but we've already seen snow around the greater boston area. delays will pile up along the interstate 95 corridor,
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this afternoon and this evening. that continues through the overnight as the storm system continues to ramp up. in terms of snow accumulations along the i-95 corridor, we could see well over one to two feet on the outskirts of boston. worcester, hartford, providence looking at snowdrifts three to four feet deep of the as we head into saturday it will slowly wind down as winds calm down as well. back to you, ashley. ashley: thank you. justin, thank you so much. appreciate it. tracy: ick. ashley: at least it is on a friday night going into the weekend. tracy: i agree actually. let's a me get home safely. here in the new york city the heavy snow hasn't started to fall yet. mayor bloomberg issued a severe weather advisory for the city. blizzard warnings are posted for parts of new jersey and long island. anna kooiman is outside again, poor thing. outside our studios with more. hey, anna. >> good afternoon, tracy. snow is picking up and so is
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the wind. millions are preparing in the northeast for the worst of the storm which is expected tomorrow night and into tomorrow. snow is expected to fall two or three inches an hour leaving whiteout conditions and widespread power outages throughout the tri-state area. states of emergency have been declared by governors in connecticut and massachusetts. boston expected to get wallopped with up to three feet of snow and from connecticut cut to maine up to three to three feet. salt trucks are pretreating roadways. schools classes were canceled in anticipation of conditions. people are stocking up on food, water, ad medications but they're really taking the storm in try. >> moving forward. you live in new england you plan for the best. >> spring break is in three weeks. lying on a beach in the sun is definitely going to get me through it. >> looking forward to that. new york city has more than 250,000 tons of salt and 1800 snow plows on standby.
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the city's transportation authority prepared to use superpowered snow throwers to keep trains running smoothly. mayor michael bloomberg is warning residents to remain indoors. >> stay off the city streets. stay out of your cars and stay in your homes while the worst of this storm is on us. that's for your own protection during potentially hazardous outdoor conditions. >> flooding also a major concern, particularly for the areas less vulnerable following superstorm sandy along the coastline. guys, fema also getting involved, monitoring the storm from washington, d.c. but telling locals to please heed the warnings throughout the northeast. back to you. tracy: anna kooiman, you heed the warnings as well. stay warm, girl. >> heading inside. ashley: run. anna, thank you very much. it is quarter past. time to check the markets as we do always with nicole petallides on the floor of the new york stock exchange. tech stocks driving gains we're seeing today. >> as you know, tech stocks we talk about the tech-heavy nasdaq right?
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the nasdaq composite is up 1% versus the other indices. aol, talk about aol. their shares are surging on the heels of their earnings we've been seeing. when you talk about advertising revenue growth, that certainly has been stellar for aol. they also have the 100 million dollar buyback program. here it is, up 7%, to 33.60. up $2.19. ceo as i noted earlier will be on with liz claman in the 3:00 p.m. show. tim armstrong. linkedin, another name on the move. all-time highs. when you talk about the ipo, remember the ipo all-time highs today. they really beat on the top and bottom lines. they have seen revenues soaring. they're seeing more members. stock is up 26 1/2 bucks. a gain of 22% right now, for linkedin. back to you. ashley: linkedin and popped up. we'll check back with you in 15 minutes. tracy: on deck the real story on real estate. the government is suing s&p for $5 billion over its
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mortgage ratings. josh rosner was one of the first to say those ratings were not up to snuff. he is our special guest next. ashley: first, look at the u.s. dollar. how is it moving today. the euro is down against pound. down against the dollar. but the pound gaining a little ground. we'll be right back. my mother made the best toffee in the world.
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>> at 20 minutes past the hour i'm arthel neville with your fox news minute. entergy is now blaming the super bowl blackout on the failure of a device installed to prevent the power outage. the utility company says the relay device was designed to protect the power supply coming into the stadium and had performed well during other recent superdome events. the manhunt continues for suspected cop killer christopher dorner. police are searching door-to-door in big bear, california after finding his burned out pickup truck near the mountain resort. the former l.a.p.d. cop is suspect in three fatal shootings including one police officer. a blizzard that could dump as much as three feet of snow in parts of new england. new york city could get hit by 10 to 14 inches. those are your headlines. get you now back to ashley.
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ashley: fox news's arthel neville. arthel, thank you. tracy: all right. well, gram fisher's josh rosner was to warn us about programs at freddie mac and fannie mae and before the crash of 2007. we look at his outlook on housing market now. i'm glad you're here. you're not buying this recoverry? >> i'm buying we're getting a real recovery in home building. new construction is up. we're not seeing follow through in that market in a dramatic way. we're seeing foot traffic increase but credit's not available so what we've got is still a continuing situation where the buyers that we're seeing are in large measure investors, not fundamental buyers. tracy: interesting that you sacred is not available because we'll get every bank on the planet to come sit here and say anybody can get a loan these days. it's fine. >> it is absolutely not true. if you look, unless your loan is sold to fha or sold to fannie or freddie there aren't too many people
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willing to hold it. you have very small securitization market. maybe we get 16 billion done this year in securitization. beyond that there is no market. banks don't want to hold it. in fact the larger banks are being, sort of disincented from holding it by the regulators. tracy: how did you know it was coming back in 2007? >> look, we had structural changes back in 2005, back in 2001, i said housing will outperform because of these structural changes until interest rates rise, unemployment rises or wages fall. okay? 2004 the fed started hiking interest rates. tracy: right. >> we saw more than a dozen consecutive interest rate hikes. usually they take 12 to 18 months to filter through the system. so by 2006 it was very clear --. tracy: it was clear it was coming. >> in 2004 it was coming and upon us. tracy: you say we have to fix the securitization market now? it hasn't been fixed? >> there is no functional fix to the securitization market. we still don't have standardized representation and warranty documents to define one party's
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obligation to another. there is still no interest in figuring out the infrastructure and architecture so that investors have all of the transparency that they need. tracy: right. >> so they can actually price loans appropriately so that borrowers are being priced based on their risk. tracy: because there is still very little appetite for mortgage-backed securities, especially among retail investors. i talked to someone much smarter than me earlier. he couldn't sell it to a retail client so save his life. >> first of all if we had securitization markets we would see bids coming in. second of all the large buyers historically --. >> bids by who? >> all large institutional investors. everyone is still chasing yield. if you had a market come back, the problem is the architecture. the problem is in the lead-up to the crisis everyone said okay, i'm starting to see defaults in the you know lying collateral. tracy: right. >> early payment defaults. i don't know what my contractual rights are. i have 300 documents with a different servicing
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agreement and different reps and requirements. i will sell them all. we ran for the exits and no one came back to civil through them until recently. tracy: to fix this you say we need more transparency? >> we need more transparency and structure. put fannie and fred's rep warrant agreement in place. we have to recognize it will not come back in the same way. we have demographic problems that aren't the same. tracy: right. >> what am i talking about? for the past 40 years, democratization of credit. consumer credit expanded. for 40 years we had the benefit of largest generation in american history coming in peak earnings years driving consumption. as a result of inflation in the '70s we forced through social change and inflation of the '70s one income to two income households giving one-time boost to consumption. those were tailwinds are now
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headwinds. those who should be first-time home buyers are stuck with a trillion dollars of student debt. so it will be a slow growth, gdp-like fundamental growth in housing for the next foreseeable future. tracy: certainly not off to the races. josh rosner with gram fisher. we could talk to you all day. >> thanks for having me. ashley: all day we've been taking a look at the recovering real estate market. our sandra smith is at an apartment in the pell building in the manhattan nomad neighborhood. the asking price for this luxury apartment? $2.4 million. that is down payment of $475,000 with a monthly mortgage payment of a cool $7,000. of course plus monthly property taxes of $971. it ain't cheap but hey, sandra, i guess my question to you, sandra, what do you get for that kind of money in new york city? >> well, ashley the manhattan real estate market is booming. for $2.4 million, for one, you get a very spacious master bedroom. it is about 11 by 19 1/2.
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big enough to fit a full size, sorry, a king-sized bed. multiple oversized windows. 11-foot ceilings. that is all good. but one prized thing in new york is closet space. here's one closet. not just one. but we have two closets. we actually have a walk-in closet. all the ladies look for space for handbags and shoes. closet space really hard to come by. an on-suite bath room and tub and stand-up shower. these are things the high end buyers are looking for. manhattan this is selling like hotcakes now. ashley they have a hard time keeping places like this on the market in new york. they are selling fast. really no housing struggles here in manhattan. ashley: who is doing the buying? we hear a lot foreign buyers are coming in many with cash in hand. are we seeing that here in manhattan? >> it's large international buyers that are many could income from argentina, brazil.
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s a real estate broker selling units in this building. i asked her where do they get the money? a lot of new international money. guess what? tied to the commodities market any families in the energy business, the gold business, the grain business, the corn and agricultural businesses in south america are thriving. a lot of those folks are on their fourth, fifth homes, buying things like this. ashley: very nice indeed. sandra smith, thank you so much. very interesting. argentina and brazil. tracy: yeah. we're going to keep talking more about the housing market. we've got to talk about the storm in the northeast is bracing for. aing about ol' whiteout conditions and up to three feet of snow. thousands of flights are canceled. we'll have the latest. ashley: yeah, stocks headed for another winning week. look at some of today's winners and losers on the s&p. we'll be right back. i'm a conservative investor.
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♪ ashley: all right. as we finish up the trading week, well, about two-thirds of the dow's 30 is in the green. hewlett-packard in the green, microsoft, intel. we like the text that nicole mentioned earlier, doing well, but some of the financials, bankamerica slightly lower. boeing also down, continuing nightmare with his streamliner. the new york stock exchange where nicole petallides is standing by. >> reporter: i am here. and we love to talk about the market, something that he embraces wholeheartedly and emotionally. >> for 30 years. >> reporter: and know you love it from the bottom of your heart. we were just talking about the technicals a moment ago. an update if. questionable whether it will be a wedding we are not with the dow and s&p. however, you're looking in a particular level at the s&p if.
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>> 1525 is a level that should be resistance. we have seen it nevertheless doubleday's where the market has gone up. backed off. you can see that they want to push it there. not a lot of volume, not a lot of commitment, but they want to push it there and see if there is resistance. >> reporter: and if there is no resistance. >> that right up through, and that will give the dow, you know, the momentum for the doubt to challenge its height of 1469. >> reporter: all the balls are saying, yes, that is what we want to hear. they would love to test all time highs. but less talk about banks quickly. >> another great performer. hearing about this housing rebound. we see in other parts of the country that housing is making a great comeback and everything connected to housing, you know, appliances, all that stuff, they are all doing well on this expected rebound. >> reporter: so far so good. all right. thank you. coming on the fox business
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network. >> thank you. ashley: thank you so much and we will be back in 15 minutes. tracy: and as we bring you the latest on housing around the country, here at fox business, economists and washington are meeting to discuss the impact of the overall economy. peter barnes is in our nation's capital with more. >> reporter: hate. some economists to think that the housing market recovery is looking pretty sustainable. they gathered at the u.s. chamber of commerce this morning where the chief economist of the chamber was positive on the outlook for housing. >> we are starting to see a better mix of supply and demand, so we have worked off some of the backlog and there are new household formations out there. that is going to help the balance and the equation, supply and demand equation down the road, so i still see housing improving. >> reporter: also in this session was frank, the chief economist at mortgage giant freddie mac expecting total home sales to be up 8-10% in 2013
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over 2012 and expect home prices to keep rising as well. prices were up about 5% last year. expecting another 3-4% increase in 2013. tracy: peter barnes, thank you very much. ashley: fox business is the place to be for all things housing today. coming up, liz claman talks exclusively with the chief, and in the 4:00 p.m. hour, former raided but -- reagan budget director tells why he says we are in a housing bubble. tracy: what? all right. well, much more ahead on the real story on real-estate. up next, dick california's rebound? we are going to ask an expert on residential and commercial real estate. ashley: first as we do every now -- first as we do know every less check the ten and 30 year treasurys as we head to break. ♪ (announcer) scottrade knows our clients trade
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career builders' survey. more than one-third of managers say they have had to fire someone for tardiness. clearly no one at the fox business network. and a blizzard warnings are out in at least five states. a megastore falls on the northeast. more than 4,000 flights have already been canceled. suspended northbound services in new york city, conn., and massachusetts have declared a state of emergency. and that's the latest from the fox business network, giving you the power to prosper. ♪
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♪ tracy: breaking news for you now. oil closing down $0.11 on the day at $95.72 per barrel. for the wheat futures fell $2.5, actually a loss of 2%. a string of eight weekly gains snapped. ashley: california was one of the hardest-hit states during
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recession, according to my next guest it has rebounded to become the top housing market in the country. joining me now, john burns, ceo of john burns real-estate consulting fee. thank you for joining is. i noticed that cash purchases accounted for about a third of all home sales last year in california which is twice the normal rate. where is all this cash coming from? >> a lot of it is coming from big investor groups that are buying distressed homes, and we are seeing a huge influx of foreign buyers, particularly from china who are paying cash for homes. ashley: does that reflect a healthy housing market? there will be people who have that kind of wealth, but is it a healthy situation? >> well, it is not the normal market. there are some people -- in fact, i think the chinese and taking advantage of the fact that home prices are falling so much. you go the exchange rate on top of that. but what this is all doing, it is creating a pretty solid fundamentals.
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we have got really strong job growth, about 2%. construction is down 84% from the peak and is only applied% in southern california year-over-year because it is so supply constraint. and the amount of supply, there is nothing of the market, such fundamentals are strong. ashley: we heard about the inventory restriction, you know, the problems with the lack of inventory for some time now. have you seen any change in homeowners wanting to put their thumb on the market more likely now to take that step because they believe these prices are coming back? >> yes. we are starting to see that slowly come back. there are about 10 percent of the people that were under water a year ago are no longer under water and are able to sell homes, so that is a level of improvement, but i am expecting it to accelerate. ashley: he said the california housing recovery is a different story. what do you mean by that? >> well, the rest of the country it is driven by strong job growth, and we are starting to see construction come back.
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in southern california -- california, okay job growth, but no ability to build homes and make money. the supply is holding things back. it is a different type of recovery, and what i mean, since they're not going to build for demand prices are going to go up. i am expecting far more price appreciation in california and the rest of the country this year. ashley: what are you hearing about the mortgage market? we get a lot of conflicting information. one guest said he can get a mortgage but other sake banks just don't want to have any part of it. what are you hearing? >> your first guest is totally right. [laughter] i mean, it is easy to get a mortgage if you can document three years worth of income and your total debt does not exceed 42 percent of your income. self-employed folks, a few other people that were out of work two years ago, it's a little hard for them, but that's about it. ashley: expecting more appreciation. what is reasonable and how far you have to go before you would say we're back to what would be considered normal?
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>> okay. we have been debating this a lot internally. if you look at the price in relation to in comes a day we are actually at normal. if you look at the mortgage payment we are more than 30 percent below normal. so we are expecting some pretty significant price appreciation, and a lot of it is induced by low mortgage rates. i saw you have david stockman of later, and he will point out this is totally fed induced an artificial. i think he is right that that is what is kick starting the recovery, but i think was going to happen this year and next year's you're going to see normal buyers come back into the market. ashley: very interesting. thank you very much for joining us. appreciate it if. >> my pleasure. ashley: well, the los angeles area, total hotbed of luxury real-estate, totally contrary to so many other areas in the country. let's take a look at his home in hollywood hills. for a mere 13 and a half million
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you could be the owner of this modern 7500 square foot home. you just need 20 percent down and your monthly mortgage payment would come out to, i don't know, $34,000. on the other side of the real-estate story is commercial space, which is a booming market on the west coast right now as well. robert gray in hollywood hills, california. he, robert. >> reporter: sandra, tracy. that's right. you can see over my shoulder, century city, at some of the commercial buildings. fact, some of, some leased by cb ref and my next guest works for that company come here to join us. thank you for joining us on fox business. talk to us about how much of a rebound we have seen of the commercial side versus where we were pre recession. >> well, the rebound has been slow. a lot of companies are still managing businesses cautiously. if you look in the last couple of months, really in 2012, the areas like seattle, san francisco, los angeles really benefited by the explosion in the high-tech job growth.
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the leasing side and those markets were strong. still have a lot of money that wants to invest in real estate, and we have seen some strength there and merely the start -- the class-a building's. >> reporter: the prime locations, still a lot of demand, but for the so-called b and c type properties, not as much demand for those. >> you see that when markets slowdown like they did in 2007- 2007-8. prices have come down, and there has been a flight to quality. >> reporter: we have not seen as a lot of jobs coming back. you mentioned, if we do actually see jobs start to be created in the economy, will we see of this building is being filled up or maybe something else? >> well, there is a trend right now. the workplace trend to do more with less. real estate is the second-biggest trusted that every company has been a pretty much every company second to labor. the average city to take less space is phenomenon. will we do right now is a company, moving 170 people in downtown l.a. in fact, moving into less space, but the new
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space we have is the way to accommodate growth for 20 percent more people. so the traditional model of looking at employment growth and how much space will be taken by that growth, those models will be tested going for it. >> reporter: very briefly, a lot of money still on the sidelines, looking to get it to buy some of this commercial real-estate. >> a lot of money. as much as we have seen that will last for five years. the biggest factor is love to value. indeed as a seven it was up to 90-25%, and now you have 60-65, could begin to 70 percent, so it makes the buyers more cautious. >> reporter: thank you. you have to put down more to buy commercial, not just residential and i would not worry about the mortgage payments. all of the buyers of these types of properties are paying cash. ashley: must be nice. tracy: thank you very much. >> reporter: i know. ashley: a quarter till, time for stocks as we do every 50 minutes. that set back down to nicole petallides on the floor of the
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nazi. >> reporter: fast to take a look and a couple of retailers. when stocks going into the s&p come but they buy them because they have to mimic the s&p 500. going into the s&p 500. a big lots, the big warehouse retailer will be coming out. now, right now about one-third of 1 percent, but it did hit a 52-week high earlier today. some brands that the license or distribute or manufacture including tommy hilfiger, chemical, donna karen, some of that -- the pressure of the last 52 weeks. back to you. tracy: millions of people bracing for snow. the latest. ashley: first a collective sigh
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♪ tracy: all right. the dow trading background that 14,000 mark in there is here we could be due for another correction if. our next guest says there could be pulled back, but there is no extreme downside in sight. joining us, senior equity strategist. good to see you. that means you think this market is reacting the way it is supposed to be. >> yes, i do. remember, a couple of months ago
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i was more bearish. as we have been trading demand as the s&p is developing this 15-. range around this 15-100. level, what i am seeing is i went back and look at all of the past, you know, the big bubbles, a 2007, 2000, the dot com. and you know, we have been talking a lot about how the markets are muddling through, the economy is muddling through. there's really no growth. and that is that thing. there really isn't, yet the values are not that expensive, so there is no bubble to burst, and the bottom line is i do not see a major, major correction like i did. and the cme is a correction over the next two months. eighty-one of 45 percent tops, but i think we can the fire. tracy: that being said, is there anything that could totally derail your plan? what bothers you the most? >> china is probably the biggest, you know, proverbial fly in the apartment. there is talk about china's growth numbers being really half of what they were. we have heard a lot of companies
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morning about china but on the other hand there are companies that want to open up new operations in china. so i think the reality is, they are sort of the big issue, but right now their children along. i would pay close attention to commodity prices because those input costs, those coming down have enabled companies to make money. margins are tied -- i'm sorry, are white, but as they get tighter that will squeeze a little bit of unease that we have. just over two and a half% is the year-over-year growth in earnings we have seen since last year to this year. tracy: that is a great point, but let's talk about it. you are not going to see a huge ball back. a buying opportunity. some of the stocks you like, applied materials. want to talk about smith and wesson. it is i. and the use of some recently. a lot of talk about guns lately. would you still buy into this? >> here is the play. it has rallied back, but historically and given its valuation m.a. is still
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relatively cheap. is it of the union address next week and i am sure the president will use the platform to talk about guns. here is the thing. smith and wesson will have a great quarter. i do not see a small team of assault weapons being part of the next gun legislation coming down the pipes. smith and wesson is a bike. i still own it and i still like it. you could buy today or tomorrow, wait until the state of the union because you might see a pullback as people get scared and then jump in and buy some more. tracy: quickly company make mortgage investment. we have been talking about housing all day. you like this. >> i think people call that wrong. opening a basically -- they will split off and origination company. very cheap for a valuation standpoint and these guys came in and basically bought up all of the junk debt. there were no buyers. taking advantage of that. very derivative play on the housing improvement that we have seen. and it is what we will continue to see because rent rates are really high. housing will remain stable.
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tracy: and good tax beneficial treatment. quickly, does this war you at all as far as the economy does? >> no. tracy: you could care less. >> i was selling cotton balls off of my upstairs to try and make it look like snow. the thing with the storm is this. actually, i want to refer back to sandy. i think another potential fly in the arm it could be that people discounted sandy and thought that it was more detrimental than good. i think it was a boom in help things. my fear is that the elements actually manifest themselves later on. that retards growth. tracy: you're right. became a stimulus at some point. senior equity strategist. thank you for being here. not really happy, you are warm and we are not. enjoy it. >> try and stay warm. have a good day. ashley: with that in mind to a blizzard warnings already in effect at least five states as that megastore meristem. 4,000 flights already canceled.
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amtrak has suspended service north of new york city. is it an emergency is being cleared in massachusetts. that to upwards. some of the areas of still recovering from superstar sandy talking of which was devastated the northeast less than four months ago. the storm already has done damage in the nation's capital. almost 60,000 homes and businesses in the washington area are without power. all of that is just bearing down, as you can see. tracy: on its way. until you what else is on her way. liz claman will take you to the last hour of trading. business leaders starting with dale ellis ceo. then housing expert. that fox business exclusive. come down to the closing bell is next. don't go anywhere. ♪
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